Morning Brief

What to watch today: Dow set to drop after jobless claims, earnings


Dow futures were sharply lower this morning after a crush of corporate earnings and jobless claims that topped 30 million in recent weeks. The Dow Jones Industrial Average surged 532 points, or 2.2%, on Wednesday after positive data from two coronavirus drug trials of Gilead Sciences' remdesivir. (CNBC)

* Weekly jobless claims hit 3.84 million, topping 30 million over the last six weeks (CNBC)

With one day left in April, the S&P 500 was tracking for its best month since October 1974. The Dow was on pace for its best month since January 1987. While still about 17% and 13% away from their February records, respectively, the Dow and S&P 500 gained more than 30% from their March coronavirus lows. (CNBC)

The Federal Reserve, following its two-day April meeting and already embarking on historic stimulus measures, pledged to keep interest rates near zero until full employment and inflation return. Central bankers also promised further action to support the economy if needed. (CNBC)


The deluge of companies reporting financial results from the first three months of the year continued Thursday morning, with Twitter reporting better-than-expected first-quarter earnings and revenue despite an expected hit to its online ad business due to the coronavirus crisis. Monetizable daily active users also exceeded estimates. Tech giants Apple and Amazon are set to report earnings Thursday afternoon. (CNBC)

Dow stock McDonalds on Thursday morning reported mixed first-quarter results, missing estimates on the bottom line as coronavirus mitigation measures forced a shift to drive-thru, delivery and takeout only. However, the fast-food chain beat expectations on revenue. McDonalds said it's suspending its stock buyback program, boosting its cash position and reducing planned capital expenditures. (CNBC)

American Airlines lost more than $2.2 billion in the first three months of the year — its biggest quarterly loss since 2008 —as the pandemic drove down demand for air travel. On a per-share basis, American reported a worse-than-expected loss and disappointing revenue. U.S. airline travel volumes have dropped about 95% in recent weeks from a year earlier as travelers stay home. (CNBC)

Tesla CEO Elon Musk lashed out at state stay-at-home orders as "fascist" in an expletive-laced rant on the electric auto maker's earnings call Wednesday. Musk called shelter-in-place measures "forcibly imprisoning people in their homes against all their constitutional rights" and "breaking people's freedoms in ways that are horrible." Tesla put near-term earnings guidance on hold after posting an unexpected first-quarter profit and slightly better-than-expected revenue. (CNBC)

Musk's F-bomb rant against lockdowns reflects 'growing sentiment,' says Dr. Scott Gottlieb (CNBC)

Facebook CEO Mark Zuckerberg said on the social network's Wednesday evening earnings call that he remains concerned that the economic fallout of the coronavirus crisis will last longer than people think. Facebook reported lower-than-expected first-quarter earnings but it beat on revenue, saying online advertising sales stabilized in recent weeks after a significant downturn. (CNBC)

Dow stock Microsoft said the Covid-19 outbreak had minimal impact on revenue, and it saw increased business in a number of its cloud-based segments. The tech giant reported better-than-expected fiscal second-quarter earnings and revenue. Other significant developments in the quarter included the unveiling of new Surface devices and the announced acquisition of data migration start-up Mover. (CNBC)

President Donald Trump said the federal government will not be extending its coronavirus social distancing guidelines once they expire Thursday, even as U.S. coronavirus cases push past 1 million and deaths approach 61,000. A number of states are going forward with reopening parts of their economies despite warnings from health experts that it's too early for such moves. (CNBC)

California, which saw its beaches and parks packed in last weekend's heat wave, plans to close them down, starting Friday.  Here is a rundown of how every state in the U.S. has responded to Covid-19 in terms of lifting restrictions on citizens and businesses. Globally, reported Covid-19 cases exceed 3.2 million, with 227,970 deaths.

Trump told Reuters he does not believe opinion polls that show his likely Democratic presidential opponent, Joe Biden, leading in the 2020 race for the White House. Trump also said he believes China's handling of the coronavirus is proof that Beijing "will do anything they can" to make him lose his reelection bid.


Macy's is planning to reopen 68 department stores Monday, in states including South Carolina and Georgia, where local governments are loosening lockdown restrictions during the coronavirus pandemic. The retailer expects to have all of its roughly 775 stores reopened in six weeks.

Comcast (CMCSA), the NBCUniversal and CNBC parent, beat estimates by 3 cents a share, with quarterly profit of 71 cents per share. Revenue came in below Wall Street forecasts. The company added 477,000 high-speed internet customers during the quarter, the most in 12 years, while NBCUniversal and Sky experienced pressure during the quarter from the cancellations of sports events due to the coronavirus outbreak.

Dunkin' Brands (DNKN) beat estimates by 5 cents a share, with quarterly earnings of 67 cents per share. Revenue also topped estimates. Sales fell, however, as the coronavirus outbreak spread, with comparable sales down more than 19% in the final three weeks of the quarter. The company has now suspended its dividend and it withdrew its 2020 outlook.

Kraft Heinz (KHC) reported quarterly profit of 58 cents per share, 3 cents a share above estimates. Revenue also topped expectations. Organic sales rose 6.2%, as Kraft Heinz benefited from increased consumer demand related to the Covid-19 pandemic.

Tapestry (TPR), the company formerly known as Coach, lost 27 cents per share for its latest quarter, wider than the 12 cents a share loss Wall Street was expecting. Revenue was above forecasts. Tapestry withdrew its full-year forecast after the coronavirus pandemic forced it to close stores, and the company has suspended dividends and share repurchases.

Cigna (CI) earned $4.69 per share for the first quarter, beating the consensus estimate of $4.35 a share. Revenue was above estimates as well. The insurance giant said it is meeting the challenges of the coronavirus outbreak and said it remains confident in the strength of its various business units.

Qualcomm (QCOM) beat estimates by 10 cents a share, with quarterly profit of 88 cents per share. The chip maker's revenue beat consensus as well. Its current-quarter revenue forecast is in line with Street expectations, as the company signs more contracts for production of 5G phones which use more expensive chips.

EBay (EBAY) reported quarterly earnings of 77 cents per share, 5 cents a share above estimates. The online marketplace operator's revenue topped estimates as well. The company said its marketplace business has been helped by worldwide shelter-in-place orders, and it gave stronger-than-expected guidance for full-year earnings and revenue.

ServiceNow (NOW) earned $1.05 per share for its latest quarter, 10 cents a share above estimates. The enterprise cloud computing company's revenue was also above forecasts, however it anticipates the most significant challenges stemming from the coronavirus outbreak to occur during the second and third quarters.

Exxon Mobil (XOM) maintained its quarterly dividend at 87 cents per share, at a time when many energy companies are cutting or eliminating their dividend. Royal Dutch Shell (RDSA) did just that this morning, slashing its dividend by two thirds after reporting a 46% drop in first-quarter profit. It was the company's first dividend cut since World War II.

Boeing's (BA) debt rating was cut by rating agency Standard and Poor's to BBB minus, one notch above junk status. The move stems from the expected impact of the coronavirus outbreak on Boeing's profits and cash flow over the next several years.

Align Technology (ALGN) earned 73 cents per share for its latest quarter, well below the consensus estimate of $1.00 a share. The maker of Invisalign dental braces also saw revenue come in below forecasts. Align was impacted by the shutdown of most dental practices in mid-March, and withdrew 2020 guidance due to pandemic-related uncertainty.


When lockdowns are lifted, some gym operators expect only 25% to 30% of people to go back to in-person classes, with the rest working out via online videos. Booking app ClassPass wants tax incentives for corporations to provide fitness classes to employees, post-pandemic. (CNBC)